April 28, 2015
Last week we wrote about the Kansas Attorney General’s intention of issuing an opinion regarding the constitutionality of fantasy sports in Kansas. The legal opinion was requested by a State Representative who opposes a proposal currently before the State Legislature that will define fantasy sports leagues as a game of skill. The sought-after Attorney General opinion was deemed necessary after the Kansas Gaming & Racing Commission, last summer, muddied the perceived viability of the proposal when it stated on its website that if a fantasy sports league has a cash buy-in and pays out a prize, then it is an illegal private lottery. In the days since our post, the Attorney General has issued his non-binding legal opinion.
How does the State Attorney General view the constitutionality of fantasy sports leagues?
In the legal opinion, the Attorney General concluded that the proposal would not violate the State’s constitutional ban on private lotteries. Informing the Attorney General’s opinion was the conclusion that fantasy sports games do not constitute lotteries because the skill and knowledge of the participants impact their success more than chance, and the outcomes of the contests are determined predominately by the performance of real-world athletes competing in real sporting events. In contrast, the Attorney General stated that the key element to a lottery is that chance determines the outcome. The Attorney General also noted that under federal law, Congress has defined fantasy sports to be games of skill, and that these contests are excluded from the federal definition of betting under the Unlawful Internet Gambling Enforcement Act, which regulates the processing of payments in connection with online gambling.
The Attorney General’s legal opinion, though non-binding, seemingly removes a significant hurdle to the passage of the Kansas proposal, as any confusion regarding the constitutionality of the bill, which may have otherwise engendered hesitation in certain tentative lawmakers, has now been clarified by the State’s top prosecutor.
Momentum Continues to Build for Legalized Fantasy Sports
We have previously written of efforts in Washington, Indiana, Louisiana, Iowa, and Montana to legalize fantasy sports. So far, none of these states’ efforts have resulted in bills ultimately being passed into law. Nevertheless, the efforts of these states, as well as the recent events in Kansas, indicate clear momentum to address the legal status of fantasy sports in those remaining jurisdictions which do not otherwise allow for legal for-pay fantasy sports contests.
The evolution of state law in this field remains a significant topic for all gaming attorneys, fantasy sports lawyers and those interested in fantasy sports law in general. Where you plan on engaging in, or operating, a fantasy sports or other gaming venture, it is important to retain competent legal counsel to help you design your contests so that they comport with applicable law.
The material contained herein is provided for information purposes only and is not legal advice, nor is it a substitute for obtaining legal advice from an attorney. Each situation is unique, and you should not act or rely on any information contained herein without seeking the advice of an experienced attorney.
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